Wall Street showed more stability on Thursday, led by a 16.1% surge in Tesla’s stock, helping lift the S&P 500 by 0.2% and the Nasdaq by 0.6%. Tesla’s rise followed stronger-than-expected quarterly profits, despite lower-than-forecast revenue. CEO Elon Musk’s projection of 20% to 30% sales growth for 2024 also fueled optimism. UPS shares jumped 9.7% after surpassing profit expectations, while Lam Research gained 5.8% with solid earnings. However, the Dow dropped 0.3%, impacted by IBM’s 6.2% decline due to disappointing revenue and Boeing’s 2.4% fall following an extended machinist strike.
This week, rising Treasury yields have been weighing on stocks, and critics say stock prices have climbed faster than corporate profits justify. The U.S. economy has continued to outperform expectations, which has led to adjustments in Federal Reserve rate-cut forecasts. As a result, Treasury yields, while easing slightly, remain elevated. The yield on the 10-year Treasury was at 4.22%, down from 4.25% the previous day.
Meanwhile, unemployment claims data provided a mixed picture, with fewer workers applying for benefits last week, but a rise in the total number of claimants to a near three-year high. Despite signs of a slowing economy, analysts see no major collapse in employment.
